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Fundamentals of Macromanagement

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Fundamentals of macroeconomics
ECO/372
June 7, 2012
Osvaldo Miranda

Fundamentals of macroeconomics
Part 1
Describe the following terms in your word.
GROSS DOMESTIC PRODUCT (GDP)
Gross Domestic Product is the monetary value of all the sales of goods and services produced within a country's borders that usually is calculated by years on a specific time period. This monetary value of sales and services includes public, private consumption, investments, government outlays, and exports less imports that occur within a defined territory.

REAL GROSS DOMESTIC PRODUCT
Real GDP is the actual value that reflects all goods and services produced in a given year. Reflect the monetary value of a specific year in comparison with prior years. Often referred to as "constant-price", "inflation-corrected" GDP or "constant dollar GDP".

NOMINAL GROSS DOMESTIC PRODUCT
Nominal GDP is the monetary value of all goods and services produced without the inflation adjusted to that specific year.

UNEMPLOYMENT RATE
Unemployment rate is the measure in percentage of the people or labor force that is unemployed but actively seeking employment and willing to work.

INFLATION RATE
Inflation rate is the rate that determines which will be the general prices level of goods and services. Also determines how the prices rise, and subsequently, with the purchases growth, the falling of prices. The inflation is observed by the Central banks to prevent severe inflation or severe deflation

INTEREST RATE
Interest rate is the amount that lenders charge, in percentage of principal, to a borrower for the use of assets. Interest rates can be noted on an annual basis, known as the annual percentage rate (APR). These assets borrowed could include consumer goods, cash, and loans for a vehicle or buildings. When the borrower is considered high risk, the interest rate that they are

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